The People Have Spoken: Icahn is Right
Last week, Benzinga asked its users to vote on Twitter which side of the Herbalife (NYSE: HLF) debate they are on, and so far the masses believe that Carl Icahn, on the long side of the bet, is correct.
If you haven't voted, you can do so here or by tweeting #TeamAckman or #TeamIcahn.
As Seeking Alpha noted last week as well, 368 institutions have bought into the company, leaving Bill Ackman scrambling for answers.
Ackman's Pershing Square Capital has now taken massive and very infamous bets on both J.C. Penney (NYSE: JCP) and the aforementioned Herbalife that could go a long way in writing his legacy as a fund manager.
Since his investment in J.C. Penney, the company has failed to rebound as new management plans have floundered.
Currently, each manager has over $525 million at stake, so the stakes are very high. Carl Icahn, the famed buyout investor who has recently been taking stakes in numerous companies to lead turnarounds, believes that Ackman is wrong and that his work is "very amateurish."
Whether Icahn is simply looking to cause a short-squeeze, he believes in the long-term value of the company as a public entity, or whether he wants to take it private, the only certainty is that he firmly disagrees with the analysis of his current nemesis.
Icahn is not the only manager to dissent with Ackman. As mentioned, 368 institutions have bought into the stock.
Notably, Blackrock (NYSE: BLK) has taken a stake according to the Seeking Alpha post and many will forget that Dan Loeb, manager of Third Point Partners, also challenged Ackman and is on Icahn's side now.
Only time will tell and the debate will eventually come down to a regulatory ruling on the legality of the transfer payments that are in question.
Stay tuned to Benzinga.com and Benzinga Pro for all of the updates as this saga, and surely many others, unfold.
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